Bitesize briefing – Faroe Petroleum

Bitesize briefing – Faroe Petroleum

Sanjeev Bahl discusses our recent initiation on Faroe Petroleum and the company’s exploration-led growth strategy. Norwegian exploration tax incentives, combined with recent success at Iris/Hades, underpin finding costs of c $1/boe (post-tax) and have delivered a portfolio of projects with point-forward IRRs ranging from 21% to 41% at $70/bbl. We believe that the market is not fully valuing the risked value of Faroe’s upcoming seven-well E&A programme that targets un-risked prospective resource of 144mmboe, or is not fully taking into consideration the positive cash flow impact of tax depreciation carry-forwards/consolidation in Norway.


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